Unlimited Vacation: Who Offers It and Does It Really Work?

Last updated: 3 April 2025

Imagine a workplace where paid time off isn’t meted out in precious days, but truly unlimited. It sounds like every employee’s dream – and a growing number of companies across the globe have made this dream a reality with “take what you need” vacation policies.

Unlimited Vacation Policies or PTO

Unlimited vacation (also called open PTO or discretionary time off) allows staff to take off as much time as necessary, as long as their work responsibilities are met. Over the past decade, this bold approach to leave has spread from trendy tech startups to established multinational firms. Below, we’ll explore which companies are embracing unlimited leave, how they structure these policies, and the patterns of benefits and challenges that have emerged.

Olga Hoving (1)
Bonus Read: Paid Vacation Days in Europe

How These Policies Are Structured and Communicated

Not all unlimited vacation policies are created equal. Companies structure and message their “take what you need” approach in ways that fit their culture.

Trust-Based, No Approval Needed:

Some organizations pitch unlimited vacation as complete freedom. Netflix and Virgin, for instance, emphasize that there’s no need to track hours or seek special permission for time off – they hire responsible adults, so they treat them that way. As long as teammates and managers are kept in the loop and work is covered, an employee could technically be on the beach for a month and it’s fine by policy. This hands-off approach works best in high-trust cultures where deliverables matter more than desk time.

Manager-Guided and Flexible:

Many companies with unlimited PTO still require the normal procedure of manager approval for scheduling time off – the difference is managers are instructed not to enforce any hard yearly limits. GE’s policy, for example, asks employees to coordinate with supervisors as usual, but there’s no set number of vacation days on the books. Microsoft’s new “Discretionary Time Off” similarly removes accruals and caps, while still expecting that time off will be taken with regard to team schedules and deadlines. In essence, it’s “take what you need, just don’t leave the team in the lurch.”

Encouraging Healthy Amounts:

A curious paradox of unlimited vacation is that employees sometimes hesitate to take “too much” since there’s no benchmark. To combat this, some companies explicitly encourage – or even mandate – a certain amount of vacation. Buffer’s policy now sets a minimum vacation of three weeks a year to normalize taking time away. Dropbox nicknamed its unlimited plan “Recharge” and actively reminds employees to recharge by taking at least two weeks off annually. Evernote, as mentioned, offers a cash bonus to those who take a substantial vacation. And at Goldman Sachs, while senior folks can jet off whenever, all staff must use at least 15 days (with at least one full week continuous) per year. By communicating clear expectations like these, companies aim to prevent a culture of workaholism from creeping back in under the guise of “limitless” time off.

Region-Specific Adjustments:

Global companies often tailor unlimited vacation policies to local laws and norms. In Europe, for instance, labor regulations mandate a minimum number of paid holidays, so “unlimited” leave usually means employees still get at least the legal minimum, and any additional days beyond that aren’t formally tracked. Atlassian, an Australia-founded tech firm, introduced an unlimited vacation policy for its U.S. offices (“Vacay Your Way”) while ensuring it met baseline requirements. Communication around these policies typically clarifies that they are “non-accrual” (days aren’t banked or paid out) and that they coexist with any statutory leave rules. This transparency helps employees understand how unlimited PTO works in practice and avoids confusion over what happens to unused time off.

“We trust you to manage your time responsibly – and we mean it.”

Benefits of the Unlimited Vacation Approach

Greater Flexibility:

Employees can take time off when needed—whether for travel, personal matters, or mental health—without worrying about fixed limits or losing unused days.

Trust and Empowerment:

The policy signals trust in employees to manage their time and deliver results, often boosting morale, responsibility, and engagement.

Improved Well-being:

With freedom to rest and recharge, employees report better health, creativity, and productivity. Companies like Kronos and Visualsoft noted higher satisfaction and engagement post-implementation.

Talent Attraction:

Unlimited PTO is an attractive perk in competitive markets, helping companies stand out as progressive and people-focused—especially valuable when salary isn't the only differentiator.

Simplified Admin:

For employers, it reduces PTO tracking and financial liabilities for unused days, allowing HR to focus on well-being rather than compliance. When done right, it benefits both sides.

Challenges and Controversies of Unlimited Leave

People Taking Less Time Off:

Without a set number of days, employees may feel unsure or guilty about taking leave, leading to fewer vacations overall. Companies like Kickstarter found that "unlimited" sometimes translated to "none."

Unclear Expectations & Peer Pressure:

Without clear norms, employees worry about overstepping or seeming less committed. If leaders don’t take time off themselves, others may hesitate too.

Imbalances & Abuse:

Though rare, some staff may take advantage while others feel unable to. Without proactive management, this can create resentment and impact team productivity.

No PTO Payouts:

Unlimited plans usually remove the option to cash out unused days, frustrating long-term staff who previously banked leave as a benefit.

Poor Cultural Fit:

In fast-paced or always-on environments, unlimited PTO may be symbolic only. If leadership doesn't actively promote time off, the policy can backfire.

The Bottom Line: Is Unlimited Vacation a Good Idea?

Unlimited vacation can be a powerful benefit—when backed by a healthy, trust-based culture. In companies that focus on outcomes and encourage real time off, it has improved morale, talent retention, and even productivity. But it’s not foolproof. Without clear expectations or leadership support, employees may take less time off, unsure of what’s acceptable. Poor communication or hidden pressure to stay “always on” can undermine the intent.

To succeed, companies should set a minimum baseline, actively encourage leave, and avoid penalizing employees who use the benefit. For employees, the message is simple: take the break—your well-being and performance will thank you. In short, unlimited PTO can be a great perk, but only in the right environment. It’s not a fix-all, but it’s changing how we think about time off—and that’s a step in the right direction.

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